Posted
by
Soulskillon Tuesday April 17, 2012 @06:00PM
from the by-reading-this-you-agree-not-do-discuss-it dept.

itwbennett writes "John Larson hears a lot of 'ideas' from a lot of entrepreneurs who want his programming expertise, but says he 'will almost never sign an NDA.' He has plenty of reasons for refusing to sign, but one that really resonates is that, regardless of what your lawyer may say, demanding an NDA upfront starts the relationship off on the wrong foot. The bottom line: If you want a programmer to hear you out, don't start by assuming that they'll steal your great idea."

My personal reason for never signing one is, the only reason to want me to sign one is so that it's easier to sue me in the future. Regardless of whether your case has merit (it won't), I still need to defend against it. No thanks.

I'd never choose to race someone to completion on an idea, but the last thing I'd ever need is for anyone to come after me, my future products, or business partners because (in someone's twisted, bitter mind) something is distantly reminiscent of something mentioned to me under NDA.

The sheer amount of time required to just read NDA's required me to find a way to stop that, or at least get paid for it.

I charged an upfront fixed fee to evaluate all NDA's or other contracts. At the time, I also offered to refund the fee on completion of the first milestone of any project they pay for. (Now I'm a regular employee again.)

Then I offered the option to hear the idea for free with verbal promise to not steal the idea provided I had not already worked on it. Some people took the option.

It's generally pretty dumb to assume an NDA serves any purpose when it comes to your employee not stealing your ideas. Unless you're completely incompetent you'll be delivering the hamburger earmuffs to the market while they're still struggling with the pickle matrix. When you start hiring workforce, you should have a pretty good idea just what you plan to invent.

And if you're one of those idiots that have some great idea and are just looking for code monkeys to do the work for you, GTFO, I have good ideas

The problem is, most of the ideas these people have suffer from one of these flaws:

1. Simply and utterly impossible to implement.2. Nothing but a copy of an existing product (you don't want to know how many questions akin to "what would it cost to make another Facebook" I get to hear).3. Is something even they wouldn't spend a dime on.

I very, very rarely get to hear a new and actually good idea. The reason for this is very simple: They are not as "creative" as they deem themselves. Chances are that someone

I'd never choose to race someone to completion on an idea, but the last thing I'd ever need is for anyone to come after me, my future products, or business partners because (in someone's twisted, bitter mind) something is distantly reminiscent of something mentioned to me under NDA.

Or more than likely not mentioned to you, but some idea that someone who worked for the company had and was dismissed at the time. Since they have evidence of the idea and you worked there then you must have seen it. Seeing someone make a success is a good way to remind people of their ideas in dusty old files.

What a great counter argument. <paraphrase>He has a blog and is therefore a well-known successful freelance programmer, and because of that he's not naive about the common requirements for obtaining funding...</paraphrase>

so that it's easier to sue me in the future

- You're being naive as well. Trust me, a company will sue you whether you have an NDA or not simply based upon the premise that they will likely weather a legal battle much more easily than you. It's not always true, but it's a "well-known" tactic.

There are perfectly valid and logical reasons to have someone who can implement your idea sign an NDA. It isn't always necessary, but it often is.

Just make sure the NDA has a relatively short term expiry (12-18 months) and is VERY specific as to market.

So, they'll sue me over anything and everything, and I should make it easier? I don't think I'm cut out for VC work.

Per my comment below though, I wasn't talking about signing an NDA for a company. TFA was about the crazy pitches you get from everybody and their brother with an idea for something that's "just like X, but Y", at least that's how I understood it.

Like most people, I probably have more opinions than experience on this--it mostly boils down to people asking me to do them a favor, but only if I agree to sign their NDA and then getting indignant when I'm perfectly happy to not code for them for free.

So, with that in mind, I'm curious how an expired NDA is more protection than not having signed the NDA in the first place. Once it expires, aren't you back to the situation where there's no NDA in place? Or is there an assumed, "signer of the NDA has rights to anything covered by the NDA once it's expired" clause in place?

And by law, for anything to be valid, it must be documented. If there is a verbal NDA, its not valid in court, unless there is audiotapes. Then again, that might not be the legal standard.Signing a NDA means if they go to court, and claim you broke it, and there is possibilties that things might look like it, you have problems. If you did not ever sign one, they can't do that.

And by law, for anything to be valid, it must be documented. If there is a verbal NDA, its not valid in court, unless there is audiotapes. Then again, that might not be the legal standard.

You're right, it isn't. Certain kinds of contracts are required to be in writing; they're defined under what's commonly known as the Statute of Frauds [wikipedia.org]. Though there is no such single statute for the entire country (it varies by jurisdiction), the traditional categories are:

Contracts in consideration of marriage. This provision covers prenuptial agreements.

Contracts that cannot be performed within one year. However, contracts of indefinite duration do not fall under the statute of frauds regardless of how

I deal with slightly different NDAs. The ones I deal with have stipulated in them, no expiration except with the express written consent of all parties in the contract. Upon termination of the NDA, all information concerning the data subject (who is invariably one of the signatories to the contract) is returned to that individual following the transfer of a token sum (£1 Sterling) to the Data Controller, who then certifies under penalty of perjury that any and all copies of said data have been destroyed. The Certificate of Destruction is then copied to the recipient of the data who signs it and also signs off the last line of the audit. A copy of the audit is kept by the DC and one goes to the recipient. By the end of it all the DC has is the wet-signed copy of the audit and the wet-signed copy of the CoD.

If the NDA is not terminated by arrangement, it does not expire. Simple as that.

It does. It's a very specific NDA, it has to be considering the information it's protecting and from whom. Once the contract terminates (for whatever reason), the data is invariably rendered irretrievable. I've had four out of probably three hundred clients actually ask for their files, the rest have asked for it to be disposed of.

I can also proudly make the assertion that I have never had a data breach.

Loser pays in my country and I don't think that there are too many people abusing the system like you say. Then again, people in my country do not sue each other over small things. Maybe this is one reason why - if you sue for some stupid thing (like the lady who sued McDonald's because hot coffee was hot), the defendant, if he believes that he can win, can hire a good lawyer and when he wind you will pay for his services. So, it would be impossible for RIAA to sue people here like they do in the US ("settle and pay us or spend more money paying your lawyer even if you win"), because they would lose money for each lost case and people would not be as quick to settle.

You presume that case where the lady sued McDonalds because the coffee was hot was a frivolous case.

I assume that the coffee was not hotter than the boiling point of water, which is what it would be if I made the coffee myself (since I would start with boiling water). The coffee was also not called "cold" or "ice", so it's a good assumption that it is hot.

Other good assumption is that a soldering iron is hot, even if unplugged, so touch only the protected part until you can confirm that it is cold.

You have to be able to try to sue anyone for anything.

Sure, but in the "loser pays" system, the semi-frivolous lawsuits result in the plaintiff being out of quite a lot of money and the defendant no worse off, while in the American system, the defendant is also out of quite a lot of money. A really good example is the RIAA lawsuits - people settle because they know that even if they win, they will lose more money than the RIAA asks now).

Over the course of the trial, Liebeck’s team established that McDonald’s had a policy of serving its coffee at temperatures ranging from 180 to 190 degrees Fahrenheit to enhance flavor and ensure that to-go cups were still warm when they reached their destinations. (The coffee that you brew at home probably comes out at around 140 degrees, so there’s a significant difference.) Moreover, experts testified that skin can burn quickly when contacted by liquids at these temperatures.

More damning, though, was McDonald’s own testimony. The company admitted that in the decade before Liebeck’s incident, upwards of 700 customers had filed complaints about its coffee causing burns.

(The coffee that you brew at home probably comes out at around 140 degrees, so thereâ(TM)s a significant difference.)

140F is 60C. You mean the water cools down by 40 degrees C in the few minutes that the coffee needs to brew? I really don't think so, but currently have no thermometer rated for 100C, so I cannot check. I make my coffee by pouring boiling water on ground coffee beans in a cup; I make tea by pouring boiling water into a cup and putting a tea bag* in it. How do you make coffee/tea?

* If I make tea using tea leaves and for more than one person, I put a bunch of tea leaves in a small teapot, pour boiling water on them and wait for 8-10 minutes. Then, I pour a small amount of the concentrated tea into cups and fill the cups with boiling water.

When I make instant coffee then it is most definitely hotter than 60C because instant coffee is instant - no need to wait the few minutes.

So, I maintain, unless the coffee was significantly above boiling point (100C/212F) it was reasonable.

Also, I find one thing very interesting. Americans, on average, want to be responsible for themselves and dislike when the government starts making decisions for them (national health care etc) saying that it is "nanny state" and bad. Yet, they become really irresponsible and want companies to take care of them (warnings that hot liquids are hot, silica gel is not food, microwaves can't be used to dry dogs, plastic bags can suffocate you if you put your head in one etc). This seems to be kinda weird - either be responsible or have companies and the government take care of you.

The company admitted that in the decade before Liebeckâ(TM)s incident, upwards of 700 customers had filed complaints about its coffee causing burns.

So, in the last 10 years, out of the millions (or tens/hundreds of millions) that McD served only 700 people were careless enough to spill the still-hot coffee on themselves?

Grab a thermometer and try it if you think it's not possible. I've done it myself (not a French press but a coffee machine and just plain cups from a pot too) and unless you're heating the grounds, your coffee mug and the parts of your French press before you use it, running boiling water (which usually averages around 190-200 degrees Fahrenheit, not 212 like you'd think) through the grounds/machine can lose fifty or more degrees easily. It may seem counterintuitive that so much heat can dissipate like that, but get a thermometer and you'll find out that just pouring boiling water from a pot to a mug can take it down to 160. One good way to illustrate this is to start with two standard size room temperature coffee mugs. Pour boiling water into one, and wait ten seconds. Dump that mug into the second, and wait another ten seconds. Then pour the second mug over your hand. While it's still very hot, it won't cause burns. It's a good way to demonstrate just how fast water sheds its heat into other materials, and it led us to the conclusion that if you want to serve coffee or tea that stays hot, fill the cups with hot water ahead of time, and then dump the hot water just before you pour in the coffee/tea.

Actually, loser pays might well *keep* the other side from running out of money in the first place if it causes potential donations from the EFF, FSF, ACLU, SFLC, and so on to turn into reusable loans instead of one time expenditures.

Presently, little guy gets bullshit lawsuit thrown at him, he either caves or prays to get one of a few precious slots in a white knight's charity budget, and hopes for the best or prays to avoid the worst.

With loser pays, little guy gets bullshit lawsuit thrown at him, white knight steps in with a fat charity budget, little guy wins, and *white knight gets its money back and can use it again* and is only out for as long as it takes them to collect their legal expenses back from the plaintiff.

With loser pays, charities that extend their legal defense funds around oppressed defendants can stretch such budgets much further when supplemented with indemnification collections from renegade plaintiffs.

If you have a solid case, charities will be much more likely to give you legal aid if they can always bill the corporation for a "refund", so to speak.

Besides that, a lawyer may be much more apt to take your solid case if they can get their pound of flesh out of the corporation's pockets instead of yours. It's similiar to taking a case on contingency.

Loser pays makes it harder for the little guy to lose on economics instead of the merits.

Oh, apparently others didn't make the same assumption I did, that we're talking about the "I'll pitch my idea to you, but you need to sign an NDA first" deal.

For a legitimate, established business? Sure, if it's either a.) short and clear enough that I can evaluate my own legal liability, or b.) You give me enough incentive to go pay for a lawyer to review it. Cash works. I have to say though, I've never had a legitimate business ask me to sign one.

Under some circumstances, not having an NDA can kill your ability to get a patent. And as the GP said, good investors will want to ensure that you have adequately protected the idea. Because the value in your business is not your cool ideas; it's cool ideas that you have some enforceable proprietary interest in.

Unless you got the HR guy to initial the sections crossed out, the courts are pretty unlikely to side with you in the case of a dispute. If you didn't even inform the HR guy that you'd modified the contract... expect a very unhappy judge (and very happy lawyers on your employer's side).

Discuss contract terms all you want with your potential employer but if you try to trick them or attempt a sleight of hand... At best you're invalidating the contract (something which will favour your employers greatly). a

Actually I saw a case in small claims court where a programmer was being sued because he had seen a company's code but refused to do the job. The company thought they were harmed by a person merely looking at their crappy code. If he had signed an NDA it would have been worse. The programmer won, but I bet he would've lost if he were sued by a large company,.

Note the well known successful freelance programmer will sign an NDA pertaining to something specific once actual employment is on the table; just not for high level initial discussions; which makes sense.

Refusing to sign an NDA ever is naive, or at least ignorant of basic trade secrets law. If I've got a secret really worth keeping; or rather keeping my ability to sue people for stealing, I need you to sign. The main reason to ask you to sign an NDA is so that it is easier to sue someone else in the future. Even if I don't think you'll steal my idea, somebody else might, and I can't sue them for it unless I can show I actually tried to keep it a secret. Typically, by requiring an NDA from everyone I disclose it to.

Refusing to sign an NDA before high-level preliminary discussions is reasonable for the reasons the article discusses. It's not that the legal situation is different, it's that if I'm not at the point of actually employing/funding you, you don't need to know the kinds of secrets it's worth keeping. The articles point is that if I want you to sign an NDA before high-level preliminary discussions, I am probably mistaken about whether my secret is worth keeping. And you probably don't want to work for me before I figure that out.

As an employer, I need to have NDAs in place with my employees to satisfy my upstream NDAs with other companies. That way, I sign that we won't disclose their proprietary tech, and by transitivity my employees are held to their end of the bargain. John Forever Alone Larson can stomp his feet all he wants, but he's clueless.

The reality is, there are perfectly good reasons to want someone to sign an NDA. If you have a great idea for a product or a new iPhone app, for example, do don't want to lay out all of the details to a web developer who may want to be an entrepreneur of his own. If you happen to have a stunning idea for something that will make a lot of money and need to hire a programmer, there's nothing to stop the programmer from thinking, "Hey, I could have thought of that!" and then build the software or website him

Ideas are a dime a dozen -- and most of them are worth far less than that.

Here's what "idea guys" don't realize: Their idea is very unlikely to be unique. If it is, it's very likely to be complete shit.

If you happen to have a stunning idea for something that will make a lot of money and need to hire a programmer, there's nothing to stop the programmer from thinking, "Hey, I could have thought of that!" and then build the software or website himself. This happens all the time.

Nonsense! The programmer in that situation says "Wow, what a moron! Lol, 'Just like facebook, but with pictures of feet instead.'! How did this guy manage to survive to adulthood?"

Most of the time what you get from "idea guys" is a deal where you work completely on my own for free and we'll 'split the profits' even though this moron doesn't have a business plan, doesn't have capital, and can't describe his idea without resorting immediately to an analogy e.g. "It should be really easy to make. It's like twitter but with pictures!"

I've got plenty of ideas of my own, thanks, and plenty of people telling me about their idiotic ideas without an NDA.

Here's what "idea guys" don't realize: Their idea is very unlikely to be unique. If it is, it's very likely to be complete shit.

"Idea guys" is a caricature. An accurate one in some cases, admittedly, but inaccurate in many others.

Many people may have the same idea, but only a small fraction have the wherewithal to turn it into a successful business. Even if you have had the same idea, the chances are that you don't have the business skills, marketing skills and so on to turn it into a sustainable source of revenue.

A start-up's NDA is not to protect the idea from other programmers. It's to protect funders from the risk of other businesspeople who have the resources to build the same business faster.

It constantly shocks me what "ideas" get turned into successful businesses. I had the software idea behind Facebook. Many of us probably did, especially those who already knew about The Well. We didn't do it because a) we had better things to do, b) there was no obvious way to make a living off it, and c) we didn't know how to run a business anyway.

What never occurred to me was the business model idea behind Facebook, namely, selling the privacy of your clients to the highest bidder. It is, as you say, complete shit. But some people spend 16 hours a damn day there. Who knew, right?

What never occurred to me was the business model idea behind Facebook, namely, selling the privacy of your clients to the highest bidder. It is, as you say, complete shit. But some people spend 16 hours a damn day there. Who knew, right?

Who knew? Lot's of people! The biggest roadblock was, and remains, attracting and maintaining users.

The idea, the business model, the code, etc. is meaningless if you can't attract users. Facebook was certainly success, but luck is undoubtedly the dominant factor there.

Look at the problems that Google+ is having attracting and maintaining users.

Really, I don't think you can point to a single thing that Facebook did specifically that made them successful over the competition -- neither the idea or the bus

Yours is a perfectly cromulent situation in which to require NDAs - employment. TFA even says as much:

Are there some situations where NDAs are appropriate? You betcha. [...] An NDA should be dependent upon the signer being compensated in some non-trivial way, as in a condition of being hired or part of terms of a sale. Requiring one prior to that is highly suspect, and signing one, I say

So, according to TFA, NDA'ing your employees is fine, because you're offering them some kind of compensation. But asking a guy you called up to have some coffee and toss around an idea to sign... not legit.

If you haven't seen that in action, btw (the "let's grab coffee and you give me your advice, but here also sign this NDA?"), it absolutely happens.

Again, he's simply being arrogant and naive. If someone sends you an NDA, especially someone who is trying to get a company on its feet, simply suggest changes to the NDA that you find inappropriate. If you think it is too broad and vague, suggest something better. If you think it should have an expiry, make the suggestion. The person sending you an NDA isn't saying to you that you're going to steal their stuff, they're saying to you "I don't know you very well."

It's not like someone who wants to hire you is going to refuse to consider your point of view.

That goes both ways - if you want me to sign an NDA, show me the money.

I don't have problems with an NDA (or even a non-compete) as long as it is a) reasonable in scope and duration, and b) isn't bundled with an IP rights grab. If you don't want me to steal your ideas, don't try to steal mine either. I routinely strike clauses in contracts / agreements that are overreaching and unreasonable - and have gotten very little push-back about it.

I routinely strike clauses in contracts / agreements that are overreaching and unreasonable - and have gotten very little push-back about it.

This is exactly right, and what a person should do. If you don't like something in the NDA, tell the person sending it to you what you have a problem with and what you suggest as an alternative (unless you want it removed completely.)

Personally, I insist on very specific market definitions and a date of expiration (usually 12-18 months.)

I've occasionally had a little push-back (from larger companies usually who have a**hole legal departments), but ultimately it has always worked.

I operate a consulting firm and work with large companies and governments. I always ask for a bilateral NDA. That way, both parties are bound to the same terms, and both have to respect each others secrets. Having a company bound to respect my secrets seems a bit more fair. And no company puts onerous terms in an agreement that it has to honor. I think once a company had a little trouble with this, but I asked why and addressed the issue in the NDA text. Everyone else has treated it as routine.

Careful throwing around silly statements like that... because contrary to popular opinion among people that don't know any better, ideas are worth even less. My 8 year old nephew has "super awesome website ideas" all the time. It doesn't mean they're worth me signing contracts over.

You want me to sign anything... I had better be compensated accordingly or have at least heard enough already to be interested.

NDA is really no big deal. Anything you bring to the table is still yours. It's also a very good way to get acquainted with potent ideas. When someone lacks an NDA, on the other hand, I tend to think they are not very serious.

Take your entrepreneur glasses off and maybe you can see that it can be a big deal. Signing an NDA may prevent the developer from working on ideas he already has, that just happen to be similar to something you have talked about in your presentation. Ideas are a dime a dozen just waiting for an implementation. Initial discussions cover all the possible and no-so-possible ground so they are likely to be overreaching, signing an NDA before talking about anything cuts off too many freelance options.

NDA is really no big deal. Anything you bring to the table is still yours. It's also a very good way to get acquainted with potent ideas. When someone lacks an NDA, on the other hand, I tend to think they are not very serious.

What if you sign it then he sits there and tells you something similar to what you're already planning to do? You're completely screwed.

A former client of mine, who did SEO, wanted me to sign a non-compete preventing me from performing SEO services within 500 miles of her office for a period of 2 years. Since I had no interest in performing SEO services at the time, I signed it without a second thought.

There are a lot of people, who like me, have hundreds of good ideas a year. But it takes a lot of money to go from an idea to an actual implementation.

Then I wouldn't say they qualify as good ideas. A good idea requires a negligible investment in time and money to carry out and it is a very safe way of making money. That's a good idea to me, nothing less.

So in other words, get-rich-quick schemes are what you're looking for. Keep on looking, AC. You'll find one that works, one day.

There are plenty of people [zynga.com] out there who WILL outright steal your great idea. Just because the original author won't and has a personal hang-up about NDAs (he feels "untrusted".. what a nonce), doesn't mean NDAs are a bad idea. Most people don't care about signing an NDA. It's a regular part of the software business. Many, many times in my personal experience, both parties EXPECT an NDA from the outset, and a project isn't considered serious without one. Some programmers won't even sign on unless they DO get to sign an NDA, or else they know it's going to be a waste of their time.

I agree. The significant thing is that in the absence of a patent, the NDA is usually the only real legal recourse the victim has. The United States, for example, has no federal law on trade secret protection, and it would be much more difficult to prove trade secret violations if there was no NDA.

NDA is about more than technical ideas too. Just knowing that a project is in the middle of development is something that needs to be kept quiet, not because someone is going to steal the project idea but because premature public knowledge will backfire, customers will stop buying your current project, you get a lot of bad press if the project is cancelled, your suppliers may be working on a similar project and stop working with you, fuel is added to the crazy blogger rumor mill, etc. This sort of stuff is more valuable to the competition than what the source code looks like or what algorithms are used.

People do go fishing for this sort of information, sometimes subtly. NDA also goes both ways; it protects the contractor and interviewee as well.

Look, if the guy is 1) a big enough deal that getting his advice is something I want and 2) well-known in the community -- and if I'm a nobody -- asking him to sign an NDA is ridiculous for all but the very very edge cases.

Just Googled that! No, I had no idea it had that meaning in those countries. Where I grew up, it's used simply in reference to people whose ideas we consider silly or nonsense. Looking at the etymology, that's one of the ways term started, but it seems to have changed over the last 20 years in Britain and Australia, and for various different reasons (mainly involving prison slang). Okay.. insert some other non-insinuating term ridiculing his suggestion!:)

I'd be unimpressed with the business acumen of both the entrepreneur and the programmer. An entrepreneur who relates confidential information without an NDA has created difficulties at the very outset of his enterprise, which may or may not be costly later. (Consider the nonsense of the Facebook litigations.) A programmer who refuses work because he won't sign an agreement that merely binds him to refrain from doing something he would never want to do anyway, has refused work for no reason at all.

Of course, an overreaching and overbearing NDA is unsignable, and of course one with other provisions (noncompetes, etc.) raise different issues. But a routine NDA should be a non-problem for an honest programmer who doesn't intend to steal anything. And the failure to sign, at least for me, is a big red flag that another programmer would be a better solution.

Get over yourself. Most of us are fungible. No reason, other than inexperience, naiveté or reserving the right to cheat can be given to refuse, all of which make the programmer unsuitable for the task. As far as the moralistic argument about starting the relationship on the wrong foot, welcome to the twenty-first century, refusal to sign an NDA is precisely that, starting the relationship on the wrong foot -- it assures suspicion. And don't think refusal to sign puts you at a legal advantage, there are plenty of common-law and statutory ways to reach someone who has misappropriated, PARTICULARLY if it is explained to the judge that the refusal to sign was simply for some moralistic, idealistic handshakey kind of deal.

The complaint is that most NDAs are not specific about what they cover, how long they last, etc. Alternately, they cover stuff already known by the programmer, or obvious to one skilled in the art. If I sign an overly-broad NDA, then if I take it seriously it may prevent me from discussing things that I really should be allowed to discuss.

Some selected bits from the article:

"Are there some situations where NDAs are appropriate? You betcha. They are appropriate when there exists something both significant and tangible to disclose, representing more than just whatever popped into your head in the shower. The 10 page business plan alluded to above makes a reasonable cutoff, necessary but probably not sufficient.

The importance of having something significant and tangible is that it’s something you can point to and say “there, THAT’S what is confidential”....An NDA that is not highly specific nor describes boundaries to what it applies is not worth signing: sloppy legalese at best, a malicious trap at worst.

An NDA should also be dependent upon the signer being compensated in some non-trivial way, as in a condition of being hired or part of terms of a sale."

Someone gets into contact with you because of your programming niche.They probably are going to present ideas that are similar to what you've worked on in the past, based on that assumption.You sign the NDA, giving them a green light to sue you while employed in your niche, because you're working on projects that are very similar to the idea that the NDA covers. It's more of a CYA move than a moralistic thing.

Hell, I wouldn't sign anything unless it gave me something in return. That mortgage, club membersh

If I understood the article correctly, he wasn't talking about NDAs signed by an employee. He works as a freelancer, and some companies demand an NDA even before discussing the job, fearing that he would copy their top secret business plan. Signing an NDA as part of the contract is okay, and he even admits that at the end. What he doesn't do is sign a legally binding paper without any information.

If one thinks that being asked to sign an NDA should ever be taken as even the slightest questioning of a person's integrity, then they are so grossly insecure about what they feel other people think, that it's probably for the best if they *DON'T* work for or with anybody else.

You already can't take what you are told in confidence and use it for financial gain. Doing so (in almost all states) can get you up to 10 years in prison, and/or a $5 million fine. The purpose of an NDA isn't to take your right away (you never had it) but to make sure the "was aware it was told in confidence" bit of the whole "trade secret" law is air tight. In the same way, verbal contracts are legally binding but hard to prove in court! Saying that "the only purpose of an NDA is to sue me falsely later" as others have said in these threads is no different than saying that "the only purpose of ANY CONTRACT is to sue me falsely" and so flat our refuse to ever sign anything ever, insisting that "my word is my bond!" Sure would be nice if that was true in general.

Speaking from the perspective of someone with a diehard entrepreneurial attitude, it's really a treat to read John Larson's candid and experienced advice. It serves to lend at least a few grains of salt to all the novel naivete that some efforts may start out with - that is, before anyone begins discussing the execution of the idea (if ever, really).

That it takes more than a bright idea to really make an entrepreneurial opportunity happen - that's a point of view I think we could hear more of, honestly. Consdering some of the get-rich-quick and instant-gratification attitudes that might become attached, commonly, to some aspects of technology, I think it would also be good if there was more discourse about the signifcance of the execution phase in software projects (whether one uses an agile model, a monolithic model, or otherwise).

Candor is good, especially in what may be commonly approached with a sense of naivete (viz a viz, enterpreneurial startups).

Considering the content of that article,I am now significantly impressed with/. I guess it's not just for spectatorship, after all;) Cheers.

Mr Larson, by posting this on his blog, has proven EXACTLY why you need an NDA. He just disclose that he would never sign an NDA... Now, in the future, whenever he's working on a project, it's clear to anyone that can do a google search that the company in question did not require an NDA... Which not only opens him up to offers from competing projects/companies, but everyone on the project.When you're working for someone, you keep your god damn mouth shut and do the job they hired you for. If you intend to

I worked with a friend a while back while he was trying to scare up funds from VCs for an idea he wanted to turn into a company. He went in with the expectation that they would sign his NDA. They told him GTFO with your little NDA. He soon discovered that from the perspective of the VC's an idea itself is generally of very little value- it is the ability to execute and bring something to market based on that idea that has real value. At least this is what they explained to him as he tried to explain to them about his valuable idea and dire need for an NDA.

The VC's were not interested in in his idea beyond the point of ensuring it was valid and had potential. They were really interested in whether HE could bring it to market. He didn't get the funds, so I guess not.

On the other hand though, I work for a software company where nobody will talk to us about the work they want us to do unless we sign an NDA. I can't speak for other companies, maybe it's just us. But for me, I kind of agree with the VC's. I have some good ideas too, but have I produced anything from them? Not yet!:)

I'd be more impressed if his reasons didn't amount to "I know your business better than you do" and "even if you think I don't, I still do and here's a couple of irrelevant examples to prove it". (And if you read the rest of his blog, it's just more of the same "I'm the greatest" drivel.)

That's like saying that locking your door is getting on the wrong foot with people on the street because it assumes they may want to break into your house. Or that checking to see if someone can program before hiring them is assuming that they're lying about their ability to program.

Or for that matter, like saying that telling your users not to reveal their passwords to other people is wrong because it assumes the other people would use the passwords to do bad things.

The entrepreneur is protected even if there is no NDA. Under Common Law, confidentiality is automatically applied to anything that has the 'necessary quality of confidence' like a business idea or trade secret. That is automatically applied even if there is no written agreement. An NDA is a good idea because it makes clear that the person knows they are dealing with confidential material. Even if there is no NDA though, the entrepreneur is still protected and can sue for damages under breach of confidence. Note: The law may vary in your area, and it is ALWAYS a good idea to get everything in writing. http://en.wikipedia.org/wiki/Breach_of_confidence [wikipedia.org]

The bottom line: If you want a programmer to hear you out, don't start by assuming that they'll steal your great idea.

Really? This is a business deal, not a marriage. You are agreeing to share trade secrets that can potentially lead to the loss of a huge sum of money if leaked to competitors. Assuming everyone is a nice guy and won't screw you over is a really poor strategic plan. MOST people won't, but you aren't going to spend a year or two dating beforehand to make sure your new-hire programmer isn't one of those people -- you are going to have a matter of hours in an interview or two in which to decide whether or not to trust each other. If you are going to get your feelings hurt when a business partner wants you to sign an NDA, then quite frankly you aren't mature enough for me to want to hire you after all.

I've been a lead programmer for about 25 years.I've only been asked to sign an NDA once.I was scheduled to talk with his team, and about an hour before the meeting he called me and said I had to sign before the meeting. I asked him to send me the NDA, which I immediately read, but it was so broad and it included a non-compete clause, so I called him right back and explained that it covered almost everything without proper limitations, and it could be used to keep me from working on anything with anyone els

It usually goes something like this. Entrepreneur can't wait to tell you about his idea that wil "literally" change the world. It's the biggest thing since the big bang and he can't wait to get started on it and start raking in the combined GNP of all the countries on earth combined. The idea is so big you just HAVE to sign an NDA because if you didn't you would for sure steal it because it's so great.

So you sign the NDA.

Then you get the pitch: it's a website called myfreediscussionsite.biz where people can go and have discussion with each other on any topic. No, it's not just a forum because you only see discussions and profile of people you are friends with. Also, you can post status updates about what you're doing and people can comment on them or give them a thumbs up. No, it's not like Facebook because this one has a red theme instead of a blue theme. Also, Google is really successful so myfreediscussionsite.biz.co.uk also has a search engine where you can search for other discussions taking place on the internet and you can post on those discussions and invite people to continue them on myfreediscussionsite.org.co.uk.net.

Once users begin using the site, users are charged a small fee for each post - just a few cents. Facebook has a billion users, and the entrepreneur is sure that we can take at least half of them away to our new service within the first month. Also, pinterest and instagram are pretty cool so you will be able to pin things from around the web and add hipster filters to them. There's something that resembles twitter in there as well, but it's better because it gives you 150 characters instead of 140 and is therefore better. The best part is you don't have to do any of the design because the entrepreneurs buddy has a son who is a "design whiz" and even got the web design merit badge in boy scouts.

Also, the guy doesn't really have any money NOW to pay you, but you'll totally own a piece of the company and you'll get a a fleet of gold-plated Ferraris as soon as they go public which will be in under 18 months for sure, unless they get purchased first for ten trillionz(tm) of dollars by god almighty himself.

In my considerable experience, when somebody asks you to sign an NDA, or won't give you any information without some arbitrary contract signing, it's dollars to donuts, an idea just like this, "you know existing site that makes billions of dollars, yeah, like that, actually, can you just copy that", and not only that, they are the FRUIT LOOPS, the biggest PITA clients you will ever get, they have no idea what they want, except that it's not what you've shown them, or it was when you showed them t

I've done the consulting bit quite a lot. I got sick of people wanting me to code cheap to get a piece of their idea. On top of that, they want anything I think about whilst I am associated with them. Even further, they want me to indemnify them in case of any patent or copyright issues. Geez.

One clown had a cheezy real estate idea, and had every clause in the book as well as agreement to not work in any related industry. All this for a 4 month proof of concept. I actually laughed at him, and said "I can't sign this, this is ridiculous" He response? We've all heard it "Why, its just a standard contract the lawyers wrote up. We wouldn't enforce any of that stuff unless there was a real problem. We just want the agreement to have teeth."

So, I'm suppose to trust someone who wants an agreement that has "teeth." Clearly he does not trust me, why on earth would I trust him? I said, I have no use for a one sided agreement that has "teeth." If he wanted to add guarantees of value and income, performance on his part, and ownership of the intellectual property jointly developed, beyond mere hourly billing, I might be willing to negotiate a fair contract. He was speechless. He just expected I would sign the contract. I left his crappy contract on the table and walked away.

We software engineers have to unionise or something, this crap has got to stop. The worst part about it, the "business people" think it is perfectly reasonable to create the one-sided and absurd contracts and software engineers HAVE to LEARN that they are dangerous.

A union will only result in you paying dues to feed an MBA who will be making all the wrong decisions for you. Or, even worse, that MBA will sell your interests to the highest bidder.

Unions may make sense in industries where workers are dime a dozen, all easily replaceable. Programmers (and good engineers in general) are not easy to replace. A programmer's code base may be completely unusable to someone else, especially if the programmer left before finishing the documentation and the code cleanup.

Clearly you have not seen the trends of outsourcing. We need to understand the "MBAs" of the world do not value us beyond merely needing a team of people like "us."

I come from a blue-collar background, my dad was a union iron worker. Trust me, there is a valuable skill set there. Strong guys who can weld, lift heavy equipment, and aren't afraid of extreme hights is, in itself, a fairly self limiting market. Anyway, the union in my view was a positive force for his industry. It set the safety standards, it p

Yes, it happened to me. Employment contract in hand, I had to sign an NDA/Non-compete protecting them. The hiring contract required I disclose my own efforts and ideas AND give up my own ventures. To prevent my perspective employer from asking my ideas and personal work, I had to list each of my ideas, business models. They wanted more details on two I was actively developing,

In good faith, I gave them some information. That wanted more - including my designs. I asked for them to sign an NDA and Non-Compete. They wouldn't. I lost the position.

Two months later, a business cropped up that implemented the features I discussed in good faith. Coincidence???? Maybe.

There was nothing protecting me, my products, and my business ideas from someone at that company taking my IP and giving it to someone else to develop. I am a single inventor and developer who made a major mistake.

Sadly, a new employer holds the cards when an unemployed individual seeks employment. I am still unemployed and have a competitor that I hadn't planned on as I job search and try to launch my business.

Yes, someone may have come up with the same idea...but, for the past two years, there was no one in my space. Two months after I revealed my plans, I had a competitor out of nowhere. Can't prove anything and have no recourse.

So, yes, I will require an NDA and Non-Compete when I disclose critical information.

There's a great scene in Orson Scott Card's book, "Lost Boys", set in the computing culture of the early 80's, in which the hero is offered a nasty NDA granting the new employer all rights to any programming he's ever done after moving all the way across the country for a programming job. The hero refuses to sign it, and the boss immediately offers him another one that is reasonable. His excuse: "you might have signed the first one." I've never been afraid of suggesting changes to NDA's and non-competes, and on 3 occasions have gotten them changed to be more reasonable. (On the fourth occasion, I wasn't really sure I wanted the job anyway.)

NDAs are like most legal tools - quite useful when utilized correctly and completely useless when placed in the hands of an amateur.

The real issue with NDAs it how ubiquitous they've become and, as a result, most people requesting them and most signing them really have no idea how to use them. I ran a fairly large business (approximately $200 million) within a much larger software company. We had NDAs but only used them when absolutely necessary because they're just too hard to properly manage.

A good NDA will specify that any information subject to the NDA will be so identified, e.g. CONFIDENTIAL or some other identifying mark. In my interactions with "outsiders" I always tried to keep information requiring an NDA at an absolute minimum. If it was really confidential enough to require a contract to prevent further dissemination then I had to really think about releasing it to anyone.

Blanket NDAs have become popular as a check-mark item to be accomplished before any meeting with outsiders. Some even think that having an NDA adds a certain cachet to the meeting and that the people attending will then feel as if they've been let in to the inner chambers. The folks who rely on such gimmicks generally have little substantial to offer. It's this amateurish approach to business interactions that drives the adoption of the NDA process, ultimately cheapening it in the process.

I had a hard-and-fast rule that I wouldn't sign an NDA without having my attorney look at it. This eliminated close to 100% of the requests for me to sign one. The worst I saw was at a chip manufacturer who's visitor log required a signature that was attached to an NDA at the top of the visitor log. I told them I wouldn't sign their visitor log without negotiating the terms but would be happy to meet them in the lobby. They replied that my signature wouldn't be necessary and I could come in for the scheduled meeting.

...since it's tough to do business with real companies when you're not willing to protect their trade secrets. However, he's talking about doing business with people who have an *idea* for a business and little more. This is a very dangerous situation for an NDA, and he's right to avoid them in this sort of circumstance. An NDA creates an obligation as well as evidence of a relationship, and presumably disclosure of information. In one scenario, their 'idea' is half-baked but broad, which if taken literally would potentially restrict one's right to work simply by having signed the NDA. Worse, it could give them evidence if they should ever choose to sue.

At my company, we recently had a discussion with our lawyers in which the outcome was that we sign fewer NDAs - *especially* with smaller companies or startups that want to talk about their ideas. We've also begun avoiding NDAs in general in which the coverage is too broad. In general, it's a good idea to avoid legal obligations, and evidence of IP exchange, unless there's a good reason to initiate it.

Note I'm not a lawyer, this isn't legal advice, void in all 50 states, territories, and foreign nations.

If the person offering the NDA really thought Larson was a thief, why would they want to talk to him in the first place?

They are asking him to legally encumber himself over an unspecified range of ideas that may not merit special protection or be unique in any way. I don't see it as unreasonable that Larson would decline such an open ended opportunity.